Compute operating cash flows using the direct method.

Tidwell Company has provided the following partial comparative balance sheets and the income statement for 20X2.

Tidwell Company

Comparative Balance Sheets

At December 31, 20X1 and 20X2

1		20X1	20X2
2	Current assets:
3	Accounts receivable	$350,000.00	$282,000.00
4	Inventories	126,000.00	147,000.00
5	Current liabilities:
6	Accounts payable	299,000.00	239,000.00

Tidwell Company

Income Statement

For the Year Ended December 31, 20X2

1	Revenues	$1,208,000.00
2	Gain on sale of equipment	55,000.00
3	Cost of goods sold	(648,000.00)
4	Depreciation expense	(123,000.00)
5	Interest expense	(28,000.00)
6	Net income	$464,000.00

Tidwell Company

Cash Flows from Operating Activities, Direct Method

For the Year Ended December 31, 20X2

1		Income Statement	Adjustments	Cash Flows
2	Revenues
3	Gain on sale of equipment
4	Cost of goods sold
5	Depreciation expense
6	Interest expense
7	Net income
8	Net cash from operating activities